SA car makers to discuss rescue package with govt
South Africa’s trade and industry minister will meet car makers to discuss a rescue package to help limit job losses, a government spokesperson said on Tuesday.
About 22 500 jobs are on the line in the automotive and component manufacturing sector, the National Association of Automotive Manufacturers said earlier this month.
Car producers including Volkswagen, Mercedes-Benz, Ford, Toyota and General Motors employ about 116 000 in South Africa and are key for a country where about a quarter of the labour force is jobless.
Car industry representatives said this month they were looking for loans at low interest rates to help with cashflow. Component manufacturers said they needed at least R10-billion in loans.
“The meeting with the minister [Mandisi Mpahlwa] and the automotive industry will take place this evening from around six,” said Lillian Mofokeng, trade and industry spokesperson.
Economists have warned of severe job losses if car makers and component manufacturers do not secure loans from the government.
Dealership owners Bidvest, Barloworld and Imperial will not be part of the rescue package discussions between the car makers and Mpahlwa.
VW has already said it would axe 400 jobs and Mercedes-Benz said it could shed about 150 jobs as domestic car sales plummet and a global economic downturn undermines demand for exports.—Reuters.